09:49     SINOTRONICS<01195> - Announcement & Resumption (4)                  

    Subscription right:                                                       
                                                                              
    Pursuant to the Subscription Agreement, the Company also granted          
    to CSFB an unconditional option upon the issue of the Original            
    Tranche 1 Bonds and the Additional Tranche 1 Bonds on the following       
    terms:                                                                    
                                                                              
    (1)   Exercise period: from and including the closing date of the         
    relevant Bonds up to and including the Maturity Date                      
                                                                              
    (2)   Exercise price: 110 per cent. of the Base Price of the              
    relevant Bonds                                                            
                                                                              
    (3)   Maximum number of Shares to be subscribed: up to 15% of the         
    principal amount of the relevant Bonds issued as at, where                
    applicable, the Original Tranche 1 Bonds Closing Date or the              
    Additional Tranche 1 Bonds Closing Date divided by the Base Price         
    (HK$0.9017)                                                               
                                                                              
    There is no prescribed sequence for conversion of the Original            
    Tranche 1 Bonds and the exercise of the Subscription Rights in            
    respect of the Original Tranche 1 Bonds.                                  
                                                                              
    General mandate:                                                          
                                                                              
    The maximum number of new Shares which may be issued upon conversion      
    of the Original Tranche 1 Bonds based on the Fixed Conversion Price       
    is 66,537,280 (applying the Relevant Exchange Rate) (being the            
    principal amount of the Original Tranche 1 Bonds divided by 130%          
    of the Base Price) representing approximately 14.2 per cent. and          
    approximately 12.5 per cent. of the existing issued share capital         
    (467,625,000 Shares) and the enlarged issued share capital                
    respectively. Upon exercise of the Subscription Right in respect          
    of the Original Tranche 1 Bonds in full (applying the Relevant            
    Exchange Rate) (being 15% of the principal amount of the Original         
    Tranche 1 Bonds divided by the Base Price), 12,974,659 new Shares,        
    representing approximately 2.8 per cent., approximately 2.4 per           
    cent. and approximately 2.4 per cent. of the existing issued share        
    capital, the enlarged issued share capital upon conversion of the         
    Original Tranche 1 Bonds and the enlarged issued share capital upon       
    conversion of the Original Tranche 1 Bonds and the exercise of the        
    Subscription Right in respect of the Original Tranche 1 Bonds             
    respectively, will be issued by the Company. The total number of          
    Shares which may be issued upon full conversion of the Original           
    Tranche 1 Bonds and the exercise in full of the Subscription Right        
    in respect of the Original Tranche 1 Bonds based on the Fixed             
    Conversion Price is 79,511,939 Shares, representing approximately         
    17 per cent. and approximately 14.5 per cent. of the existing issued      
    share capital and the enlarged issued share capital respectively,         
    which Shares, will be issued pursuant to the Existing General             
    Mandate.                                                                  
                                                                              
    The maximum number of new Shares which may be issued upon conversion      
    of the Original Tranche 1 Bonds based on the Floating Conversion          
    Price cannot be ascertained at present because the Floating               
    Conversion Price can only be determined when the notice of                
    conversion is issued by CSFB. In any event, the Company and CSFB          
    agree that the maximum number of Shares to be issued pursuant to          
    the conversion of the Original Tranche 1 Bonds and the exercise of        
    the Subscription Right in respect of the Original Tranche 1 Bonds         
    will not exceed 93,525,000 Shares, i.e. the threshold of the              
    Existing General Mandate which is applicable to the Shares to be          
    issued upon conversion of the Original Tranche 1 Bonds and the            
    exercise of the Subscription Right in respect of the Original             
    Tranche 1 Bonds. CSFB has been informed by the Company and CSFB and       
    the Company agree that the Company will exercise the Downside Option      
    to redeem the remaining balance of the Original Tranche 1 Bonds if        
    the number of Shares to be issued pursuant the conversion of the          
    Original Tranche 1 Bonds and the exercise of the Subscription Right       
    in respect of the Original Tranche 1 Bonds will exceed 93,525,000         
    Shares. The mechanism and the relevant formula to redeem the              
    remaining balance of the Original Tranche 1 Bonds is the same as          
    the mechanism and formula set out in the paragraph headed ``Early         
    Redemption'' above. The threshold of the Existing General Mandate         
    (i.e. 93,525,000 Shares) is only applicable to the Original Tranche       
    1 Bonds and the Subscription Right in respect of the Original             
    Tranche 1 Bonds.